Committee Report CR-8
The Economic Development, Training and Employment Committee held a meeting on June 28, 2011, beginning at 3:08 p.m. in the Sullivan Chamber for the purpose of discussing the creation of the city's economic development goals.
Present at the meeting were Councillor Leland Cheung, Chair of the Committee, Brian Murphy, Assistant City Manager, Community Development Department (CDD), Susan Glazer, CDD, Chris Basler, CDD, Pardis Saffari, CDD, Janneke House, Cambridge Local First, Terrence F. Smith, Chamber of Commerce, Walter Jenkins, MIT Investment Management Office, Patrick Verbeke, Valti LLC, 91 Sidney Street, Mr. Carlone, architect and urban designer, 16 Martin Street and Charlie Marquardt, 10 Rogers Street.
Councillor Cheung welcomed those present and opened the meeting. He stated that the purpose of the meeting was to define economic development goals for the committee to recommend to the City Council for FY13. He distributed an agenda for the meeting (Attachment A), the City Council' economic development goals for FY09-10 and FY 11-12-13 (Attachments C&D) and the Community Development Department's economic development budget goals for FY12 (Attachment E) as background information. Councillor Cheung then distributed for discussion the suggested goals that he received as a result of a survey that his staff sent to the list of participants of previous meetings of the Economic Development Committee (Attachment B). The survey requested their suggestions as to what economic development goals the City should focus on. Councillor Cheung stated that he expected that the process of prioritizing goals should take two hearings, one to discuss the goals and one to finalize the goals for the FY13 budget.
A discussion of the suggested goals ensued. Regarding suggested goal #2 (emphasis on creating more neighborhood groups and fostering community outside the squares), Mr. Carlone spoke of the importance of meeting space for groups. Terrence Smith questioned what the City's involvement should be relative to neighborhood groups. He stated that he is a representative of a neighborhood group and he does not believe that it is the City's role to fund such organizations. He stated that the best thing the City can do is provide excellent services to people of Cambridge, which Cambridge does very well. He stated that there are two communities in Cambridge, neighborhood and business and the distinction between the two should not be lost.
Ms. Glazer stated that CDD's Economic Development Department (EDD) has supported the business community b y helping business associations promote businesses in their areas. The EDD does help neighborhood associations, though not financially, in terms of staff time, printing, technical assistance and the like. CDD also helps smaller neighborhood associations get off the ground and get moving.
Terrence Smith stated that the Chamber of Commerce supports those types of organizations as well. He commented that sometimes the requests from the organization are for funding and that skews the relationship. He stated that City staff should not become the responsible party. Mr. Smith commented that it is important that people become empowered. He stated that technical support is important but that it must be limited as neighborhoods are responsible for the ultimate support of the association.
Regarding suggested goals #3 (hardship for commercial landlords and tenants when the new tenants wants to use the space for a use not listed in the allowed uses for zoning district where the premises are located. Even a slight change of use could require a zoning variance which requires an application and hearing), # 7 (simplify zoning) and # 8 (accelerate zoning decisions), Councillor Cheung asked Charles Marquardt to speak on these issues. Mr. Marquardt stated that there is great need for the streamlining of the permitting/licensing processes. To go from a crepe restaurant to a waffle house requires a variance. It has taken him six months to get the necessary authorization to remove a wall inside his home. He recommended establishing the use table as a hierarchy of use. If I II and III are the overarching use categories and (a) (b) and (c) are more specific uses in the III category, then the ordinance could authorize City staff to sign off on changes of the subsidiary uses. This could accelerate what has become a 6-9 month process to a month. Councillor Cheung stated that this issue was previously labeled a priority. Mr. Marquardt stated that non-conforming status of so many buildings in Cambridge exacerbates the difficulty of making modifications and changes to the building's structure or use that could benefit the business.
Dennis Carlone spoke of a couple that is opening a business to sell nuts and candy on Massachusetts Avenue between Harvard and Porter Square. This is not a zoning change, but the process has taken six months. He stated that they are first-timers and they may need to be helped more than someone who has been through the process before. The permitting is the issue in this case, not zoning. Getting permits has proven to be difficult. He stated that some cities boast "one stop shopping."
Mr. Smith stated that it is a change of use issue, which is a zoning issue. He feels that the Zoning Table of Uses is where one most often runs into problems. He believes that this has to do with the complexity of the Zoning Ordinance and stated that almost half of the properties in City are non-conforming. The Zoning Ordinance issue has not been made easier. Councillor Cheung stated that he was hopeful for some kind of resolution of this problem in this Council term. He stated that there should be a more systematic review of zoning.
Mr. Murphy stated that the reason that a change of use requires a zoning variance is that a change of use will have an impact on the neighborhood. He said that it makes sense to go back and review the table of uses and the current process to see if tweaks to the current process could improve it. The streamlining issue makes sense. One ongoing project in the upcoming budget is putting more permits online through the Inspectional Services Department. He state that he believes that would be beneficial for all involved. He would be happy to take look at the process and what can be streamlined. CDD would like to find ways to reduce time for different processes.
Councillor Cheung asked that the Table of Uses be reviewed for ways to accelerate the decision process, especially for clear-cut issues.
Regarding suggested goal #4 (take advantage of unused warehouse space to lower the rent for start-ups so they can afford to stay in Cambridge instead of moving to Boston's Innovation District), Councillor Cheung asked whether there is any unused warehouse space in Cambridge. Mr. Carlone stated that there is some warehouse space in Neighborhood 9 and North Cambridge. Mr. Smith said that the Concord/Alewife rezoning encourages more mixed use and less industrial use. He does not believe that we have made it harder for pre-existing businesses to exist but it has become harder for companies to come into the City.
Mr. Jenkins stated that warehouses are built to hold "stuff" and when people move in there are not enough bathrooms, parking, etc. Warehouses are not located close to public transportation. He commented that start-ups want to be close to people and transportation. MIT has properties that they would like to do things with but do not lend themselves to needed uses. Warehouses are a wonderful concept but difficult to execute.
Councillor Cheung stated that he wants to ensure that there is a vacant space database listing potential sites for interested parties.
Ms. Saffari stated that she often suggests that people broaden their aspect as far as location when they are looking for space. She stated that she reminds people that Cambridge is only a six square mile city and maneuvering about within the City is not difficult.
Regarding suggested goal #19 (ensuring that the City actively promotes Cambridge as a place to grow business), Councillor Cheung stated that he would like to see a more solid base in which to grow a business.
Mr. Carlone questioned whether the Chamber of Commerce or the City sends welcome packages to new businesses. He believes that sends an important message that the City is invested in its businesses. Councillor Cheung stated that he makes it a priority to sponsor City Council resolutions when he becomes aware of new businesses opening in the city. Ms. Saffari commented that the CDD does make every effort to stay on top of transitioning businesses due to the move in dates of said businesses.
Mr. Smith stated that given the complexity of the issues, the City of Cambridge staff at the License Commission, the Water Department, Pubic Works, etc. do a very good job but the problem is that what each individual department needs can appear to be in conflict or there can be a duplication of information. He stated that the system needs to be simplified in order to provide excellent service.
Mr. Marquardt stated on his tax bill there is only one line that is geared to commercial taxes. He stated that more information regarding commercial taxes would be useful to homeowners and beneficial in showing the comparison to the commercial rate which is $11.00 lower than Boston.
Regarding suggested goal #6 (that a unique identity for each neighborhood be established and marketed), Councillor Cheung stated that the City Council recently passed the designation of Central Square as a cultural district. Mr. Carlone suggested that each area of the city participate in a survey to state what kind of retail is wanted there. He commented that such surveys may be helpful for business people seeking to navigate through the zoning hierarchy. He commented that if neighborhoods are involved and all parties are on the same page, then the zoning/permitting issues may be minimized.
Regarding suggested goal #9 (need to add additional floors and GFA/FAR to single story retail establishments in major parts of the city), Mr. Marquardt stated that in order to keep first floor boutique retail shops in business, their rents must be lower that the rents a property owner would get from renting to a bank or cell phone store, which means that there have to be additional stories of housing or commercial uses in the buildings in locations such as along Massachusetts Avenue to support the first floor boutiques. Mr. Smith stated that along streetcar corridors one would typically see ground floor retail and apartments above.
In speaking to suggested goal #10 (diversification of industries), Mr. Carlone stated that all space cannot be retail and the city needs to think how we treat that. He stated that he knows some that say form-based zoning will not happen here but it is something that should be investigated and that the principles of form-based zoning should be incorporated into our zoning. Mr. Smith stated that regulations need to allow for diversity. Councillor Cheung inquired as to how regulations would achieve that goal. Mr. Smith stated that the way that you get diversity is to make it possible for a variety of businesses to stay here. He added that when Cambridge's tax rate is 2/3 that of its largest competitor (Boston) and a business is looking to be centrally located, the field narrows between Cambridge and Boston. What fills that gap between Cambridge and Boston is that you can spend less and get more in Cambridge than Boston.
On suggested goal #11(encouragement and assistance in the development and launch of new companies), Councillor Cheung stated that we need to do more to support the clean energy community in the City. Mr. Marquardt questioned how the City could acquire a piece of such a company to let them use rooftops, etc. Councillor Cheung commented that there would be a myriad of issues for the City to have stock in private companies.
Councillor Cheung stated that the City of Cambridge promotes jobs for area residents as stated in suggested goal #12. Mr. Murphy stated that the challenge is that there are not that many Cambridge residents involved in trades. Mr. Smith stated the importance of the schools to provide students with broader scope of career paths. Mr. Murphy stated that the city is working to ensure that students and employers give kids a sense of what is out there regarding trade opportunities as well.
Regarding suggested goal #13 (better collaboration across organizations and the region), Mr. Smith stated that the Chamber of Commerce helps to facilitate business organizations and other Chambers throughout the state as a way to connect Cambridge businesses with the rest of the region as it relates to work done outside of Massachusetts.
Janneke House spoke on suggested goals #14 (ensuring that all city staff with purchasing responsibilities have full knowledge of the priorities of the City to think and buy local) and #15 (create some sort of incentive to encourage city departments to buy from local retailers, for example, a cash back program). She reiterated the importance of buying local and stressed the resources in Cambridge and the importance of using them. Ms. House stated that she was not familiar with cash back programs. Mr. Marquardt stated that it is wise to remind people to buy local due to the fact that local businesses are starting to feel the impact of purchases made via the internet. Ms. Glazer noted that the City is required to follow strict rules with regard to purchasing practices and procedures, such as requesting bids, documenting response, accepting the lowest bid, etc.
Regarding # 17 (improve the physical infrastructure in areas where big business is located) Mr. Carlone stated that if Cambridge wants to encourage businesses, it is not just removing a bush or graffiti; it is making sure lighting is adequate and attractive, that there are comfortable places to sit. People will go where it is a pleasure to shop. He commented that studies have shown if there are comfortable places to sit, sales go up 10%. He said that he wishes there were centers where people could gather.
Mr. Carlone stated that taking a cohesive district as a whole is not mentioned. All squares can be improved as special places. Some spaces are sad at the edges. Brian Murphy stated that he is looking to make goals more smart goals in general. He commented that the challenge is that it is a softer goal whereas some other goals could be more robust.
Mr. Smith stated that when the Chamber of Commerce and the Office of Tourism are contacted they encourage individuals and groups to come to Cambridge when they visit Boston. He stated that it is important to make sure it is easy to navigate the City.
Mr. Jenkins stated that MIT had a number of vacant buildings and they have been recently successful in finding occupants for those buildings. When MIT went through a process to identify tenants, the perception was that it is easier to do business in Cambridge than Boston. That being said, it was still a difficult task with multiple steps such as permitting process, zoning issues, etc. There is no single set of rules. As a community we can tell people that we can help you, try to make it easier for you, etc. He commented that perhaps some type of ombudsman to help navigate the process would be helpful. Direction is what businesses need. Some landlords just want to get their rent and don't go that extra mile while MIT went national to fill buildings. He stated that it may behoove the City to go out, say I'm going to represent landlords, state what properties are available and give contact information for said property. If the perception is that Cambridge wants to do business, it will happen. The smaller guys need the way paved.
Mr. Smith said it would be great for someone in the CDD to be the ombudsman. A simple approach is to require fewer variances. Absent that, we need to make it easier and be able to direct interested businesses to the services provided.
Mr. Murphy stated that a great deal of Ms. Saffari's and Mr. Basler's work is helping small businesses get started and overcome hurdles. It could be beneficial to have case study sessions to gage how the process works, what was difficult, etc. The CDD is also trying to have a more customer-friendly website.
Ms. Saffari stated that the CDD has workshops to aid businesses in navigating the City and its services. She stated that the workshops will be starting up again soon. There was a request from a business owner that the workshop schedule include some earlier and later times than the last schedule.
With respect to goal # 18 (create programs to support our three business sectors: entrepreneurs, large R&D based, and local) Mr. Marquardt raised the issue of how the City can work with the Cambridge biotech community to showcase the strengths and advantages for biotech companies to locate in Cambridge. BIO 12 will take place in Boston next year. Companies like Alexandria that stand to benefit from the interest that could be generated at this mega conference may want to partner with the City to produce an outstanding display.
Councillor Cheung then asked all who were present at the meeting to choose from the list of suggested goals the five that they believed were the most important for the City to focus on for the FY 13 fiscal year. Thereafter he collected the lists and explained that his aide would tabulate the results. After the results are tabulated they will be forwarded to CDD's Economic Development Department and discussed at the next Economic Development, Training and Employment meeting on this topic.